Even though Bill Potter spends hours each month poring over hundreds of pages of local phone bills and paying everything he owes, his Chicago company still gets threatened by bill collectors and stung by service shutdowns.
Potter has been slammed, crammed, double billed, and, in the end, mostly ignored when he complains.
And while Potter’s experience may not typify the new era of local phone competition, neither is he a lone voice when it comes to telecom horror stories.
Plenty of other small-business owners are being stung by mismanagement, miscommunication and misinformation associated with local phone competition, which is beginning to hit Chicago some four years after the passage of federal legislation aimed at promoting it.
While long-distance competition has been common for years, local phone service competition still is fairly rare for residential customers.
But competitors have been trying to lure business customers away from Ameritech since shortly after the 1996 federal law kicked in. The problems that have ensued are discouraging some corporate customers from seeking alternatives to Ameritech, undermining the benefits that competition was supposed to bring.
In Potter’s case, it was spring 1998 when Chicago-based local phone service US Networks Inc. contacted him, promising his firm could save significant money if it left Ameritech.
Potter, who manages phone service for the six offices of A Better Resume Service Inc., asked USN for a proposal, but he never agreed to switch to the upstart. USN evidently took Potter’s interest as good enough to open an account, and the now-defunct phone company started sending him bills that summer.
“We were still getting bills from Ameritech, and paying them, for periods that USN was billing us as well,” Potter said.
Potter spent months calling and arguing with people from USN and Ameritech in efforts to get his local service returned to Ameritech. USN went bankrupt during that time and was bought by another firm, which continues to bill Potter’s company.
Even worse, Ameritech now contends that in the process of switching back from USN, Potter agreed to spend a minimum of $30,000 over three years on one line that averages only $67 in phone charges. Potter said he never agreed to such a thing, and the issue remains unresolved.
Having phone carriers switched without permission–slamming–and being signed up for service you didn’t order–cramming–are familiar plagues of long-distance competition. The Federal Communications Commission has logged more than 170,000 such complaints in the past five years.
But in the realm of local service, slamming and cramming are only the gateway to a maze of trouble that can ensnare a phone customer, especially one whose business depends on reliable service.
Bill Krieg, who runs the Men at Arms military history shop in Lombard, learned of competition’s pitfalls last year when he changed local service to AT&T.
Once the switch was made, Krieg’s business phone number was dropped from Ameritech’s directory assistance service, so people calling 411 were told there was no listing. Also Krieg found that AT&T couldn’t handle his credit card processing and security system as promised, he said.
It took him months to get the service changed back to Ameritech.
“I have no idea how much business I lost,” said Krieg. “We’re a specialized business and people call from all over the country. When we weren’t available through directory assistance, there was no way those customers could reach us.”
In Joliet, when Wayne Horne’s insurance business dropped Ameritech in favor of McLeod USA Inc., his agency’s number not only was dropped by Ameritech’s 411 assistance, but also dropped out of the yellow and white pages in Ameritech’s phone books.
Fortunately, Horne said, McLeod’s service is becoming so popular that customers look for him in McLeod’s phone books, and he doesn’t worry about being dropped from Ameritech’s listings.
“Ameritech still sends me bills,” he said, “but I just ignore them. They ignored me for years, so now I ignore them.”
Still, in places where Ameritech’s service still dominates, business customers can’t ignore it so readily. Bob Koester, who runs the Jazz Record Mart in Chicago, found that his firm’s listing was dropped by Ameritech shortly after the store’s service changed to McLeod. It was difficult for Koester to get the service switched back to Ameritech, he said.
Even though McLeod has been “sweet as pie through all this,” Koester said he told his store manager to stick with Ameritech because the business can’t afford any trouble with basic phone service.
There is no evidence that Ameritech purposely causes trouble for customers who go elsewhere, but a common response when someone starts having any kind of trouble is to rush back to Ameritech.
“Whether it’s intentional or not, having phone problems is detrimental to competitors,” said Charlotte TerKeurst, a senior vice president with Competitive Strategies Group, a Chicago-based telecommunications consultancy. “It can stifle competition.”
TerKeurst, who once worked for the Illinois Commerce Commission, said that it was common for the commission to call the phone company to resolve customer complaints quickly and informally.
Debi Barr-Holquist, manager of the commission’s consumer services division, said her office offers a toll-free hotline–800-524-0795–to help customers having trouble getting the attention of their carriers.
“We’ve had a handful of customers who were dropped from 411 listings, and we got them back in,” she said. “The commission has ordered that Ameritech must carry listings of its competitors’ customers in 411 and in its directories free of charge.”
But the competing carrier is responsible for giving Ameritech the appropriate listing information, she said, and snafus occur.
Consumer advocates argue that the commission’s role as an impartial defender of consumer interests must be enlarged as competition among local phone carriers becomes more common.
Last month the Citizens Utility Board filed a complaint with the commission alleging widespread misinformation from Ameritech to its customers. CUB contends that Ameritech representatives misled consumers into buying service plans that inflate customer bills.
Martin Cohen, CUB’s executive director, said that as local phone competition develops, the commission should serve a new role in protecting consumers against being duped by phone companies seeking to exploit marketplace confusion.
“When a customer tries to call Ameritech to complain about service, bills or anything, it takes forever to get through to someone, and then it’s common to be put on permanent hold,” Cohen said. “We hear this all the time from consumers who call us.”
Last week regulators in Ohio threatened Ameritech with fines totaling $200 million for what is seen as broken promises to improve local phone service. Ameritech denies that its service quality doesn’t meet standards, and in Illinois, the firm contends it is often unfairly singled out for criticism.
Joset Wright, president of Ameritech Illinois, recalled one incident where Ameritech was called by a commission staffer for help in locating the competitor who was responsible for a customer’s service problems. “There’s a long history of competitors blaming us when something doesn’t go right for their customer,” Wright said.
At least one AT&T customer experienced the blame game that large phone companies sometimes play.
When David Newton, who runs a printing business on Chicago’s North Side, found that customers couldn’t call his office, he called his local carrier, AT&T, to get his service restored.
“It was so frustrating because nobody was helping,” said Newton, whose incoming phone lines were out for more than a week. “They were very quick to say the problem was Ameritech’s fault. I wonder what that was about. I don’t care about blame–I’ve got to have my phone service, not excuses.”
The commission is in the process of adopting a new rule that would require phone companies to keep track of how difficult it is for customers to reach service representatives. Easy communication with a phone company would become a requirement, much as the state now requires companies to restore disrupted phone service.
Other changes in the commission’s oversight of telecommunications are being advocated both within the commission and outside.
AT&T, Ameritech’s biggest competitor, is backing legislation in Springfield that would bolster the ICC’s authority, making it a needed “competition cop,” said John Dunn, an AT&T attorney.
Ameritech is pushing its own legislation that would generally trim the commission’s powers, but the legislation doesn’t intend to reduce the commission’s ability to protect customer interests, said Ameritech’s Wright.
“Clearly, at the end of the day Ameritech wants to make sure our customers are well-served,” Wright said. “If the customer can’t get something resolved by talking to us, it’s appropriate to have the commission intervene. Having said that, we believe the commission should have equal authority over all competing carriers, not just Ameritech.”
